Why Tesla Stock Is Down For 2nd Straight Session: 'End Of Historical Run,' Says Analyst

Tesla, Inc. TSLA shares were moved to the downside in premarket trading on Thursday, potentially extending the losses to a second straight session.

On Wednesday, the stock slid 5.49% to $259.46 as traders took profit amid deterioration sentiment toward tech stocks in general. The stock also reacted to a negative analyst action.

Barclays analyst Dan Levy downgraded the stock from Overweight to Market Weight, citing the near-term stock run-up and fears of inventory build-up in the second quarter.

Morgan Stanley analyst Adam Jonas Thursday downgraded the stock from Overweight to Equal-Weight and raised the price target

Tesla bear Gordon Johnson of GLJ Research noted that Wednesday’s retreat was accompanied by heavy volume, as 209.88 million shares exchanged hands. The heavy volume lends credence to the downside, he said.

TSLA closing below its opening price, on such strong volume, likely suggest the session was the “reversal day that marked the end of TSLA's stellar/historical stock run,” Johnson said, citing his technical team.

Ahead of Wednesday, the stock traded 10 days above a relative-strength index of 80. With the pullback seen on Wednesday, the RSI has slipped to 72.9, suggesting the stock is still in the overbought zone.

The 10-day moving average, which should be at $254, is a key point of resistance to the upside and/or downside, followed by the 50-day, 100-day, and 200-day moving averages, Johnson said.

“The stock has not yet broken down, ” he said, adding that it needs to hit some of those moving averages for the machine algo selling to really begin to kick in.

In premarket trading on Thursday, Tesla slid 3.17% to $251.23, according to Benzinga Pro data.

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See Also: Everything You Need To Know About Tesla Stock